ABSTRACT
Introduction Is there something fundamentally untenable, inherently risky, or even perverse about a form of money which is not linked to, dependent on or identified with a nation-state? Given the emerging markets crises of 1998 - an important trigger of which was excessive foreign-exchange debt - the answer might appear to be self-evident. Even George Soros - allegedly the freewheeling nemesis ofBritain's participation within the European Exchange Rate Mechanism (ERM) in September 1992 - has recently added his voice to calls for much tighter international regulation of money and finance (see Soros, 1998). But the question cannot really be answered until we develop a more precise understanding ofso-called international money. We have to grasp in a more exact way the different forms that international money might take before we can evaluate the nature of the threat it could pose to the ability of national governments to pursue their monetary policies. For example, we need to be able to distinguish between instances where states co-operate with each other in the issue and control ofmoney, as against those where international or transnational institutions seem to be taking over or superseding the sovereign powers ofindividual states altogether. And we must decide how to characterise the problems posed by international money in a way which takes account of the fact that the emergence of such problems is the result ofa process in which information is interpreted by and contested between experts and state representatives. In short, we cannot treat the risks of international money as given. We should therefore exercise caution before regarding them as particularly new or distinctive. This reservation underpins the four main questions I shall be addressing in this chapter:
• How important is the relationship between money and the nation-state? • What, ifanything, distinguishes international money from other forms? • What is the nature ofuncertainty and risk in relation to international money? • What is regulation at international level? How does it work and who is
responsible for it?
